A new report by Allen Overy based on research by 1,000 business
leaders from large international companies across 19 countries has
pointed to future growth.
The Opportunities and Challenges report is the first in a series looking at how Asia’s rapid growth and development is expected to influence business decision making in the future.
While the world looks to China for growth, China has been seizing its own opportunities for growth around the world.
Analysis of FDI data from A&O’s InvestmentPerspectives shows that there has been a 457 per cent increase in China’s FDI outflows between 2005 and 2010, when they reached US$ 68 billion .
China believes that its best opportunities for growth lie with India 27 per cent followed by the US 25 per cent and then China 19 per cent.
The wealth of opportunities is creating a feeling of economic stability, which is the key driver behind Chinese business leaders being among the most confident globally.
Sixty-five percent of Chinese business leaders say they are very confident about their business’s prospects in the next 24 months, compared to 53 per cent globally.
The findings of the report also confirm the growing strength and influence of the Asian economies, with Asia Pacific’s economic influence seen to be rising by 75% of those surveyed. Europe and North America received the highest scores from business leaders saying their economic influence is in decline, with 22 per cent and 19 per cent respectively.
However, respondents in China and Hong Kong were less inclined to agree, with only 12 per cent saying North America was in decline.
While globally business leaders believe a Eurozone sovereign debt default is the greatest threat to the global economy, executives in China see more pressing concerns closer to home.
One-third of respondents from China say an Asian economic slowdown is the biggest threat, followed by protectionism 17 per cent and inflation 15 per cent.
In Hong Kong a Eurozone sovereign default is still seen as the biggest threat by 25 per cent, with an Asian economic slowdown and inflation tied in second with 15 per cent choosing both.
While China presents the best growth opportunities globally it is also perceived as the hardest market to enter due to barriers to entry, according to 21 per cent of executives globally, as closely followed by the United States 19 per cent, Russia 17% per cent and Germany 12% per cent.
The regulatory environment is identified as the largest hurdle to market entry in all of the identified top growth markets.
A copy of the 50 Degrees East: Opportunities and challenges report can be downloaded at http://www.allenovery.com